- The Washington Times - Sunday, August 7, 2011


The debt crisis is likely to be with us for quite a while. And since the TV talking heads speak in gobbledygook, what could be more useful right now than a layman’s glossary? Herewith:

Banks — Safe houses where hardworking individuals and corporations put their savings, supposedly to finance discreetly other people’s worthy projects.

Bonds — Paper representing company or country debt bought and sold with interest paid to owners, whose value peaks when repayment looks more and more unlikely.

Central bank — Each government’s own bank to protect the national prosperity by printing money at a proper level and manipulating it against other currencies.

Correction — When the bottom falls out of the stock market and small investors get caught with their pants down, not knowing whether to hang on and hope or sell at a loss.

Derivatives — Bets on bets on bets hidden in computers until someone punches in the wrong algorithm and all hell breaks loose.

Dollar — The U.S. currency, losing its value in a deteriorating economy, but still the standard for international transactions and the guarantee for other, even weaker currencies.

ECB — The European Central Bank, the euro’s mother bank, which is proving unable to salvage bankrupt Greece, Portugal, Ireland, Spain and perhaps Italy, which can’t pay their bills because they borrowed too much elsewhere.

Euro — The European Union’s common currency, now in deep trouble because 17 different finance ministries are driving their countries’ taxing and spending in 17 different directions.

Financiers — Technocrats who believe they have mastered markets in order to feather their own nests, but who panic in times of crisis, endangering the system by calling for government handouts.

GDP — Gross domestic product, an estimate of all national economic activity, often divided to give a widely used per-person figure not revealing much about you and me.

Geithner, Timothy F. mdash; The U.S. chief financial officer who is looking for a way to get off the Obama ship of state after his government bureaucratic instincts called all the shots wrong.

Gold — A precious (as in “valuable,” not “cute”) metal whose value is considered immutable and therefore a refuge when currencies cheapen, and thus is selling at all-time highs.

IMF — The international money pot, the cavalry that was supposed to come to the rescue when individual donor-members got into trouble before the whole kit and caboodle got too big and complicated.

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